Question

29.      Which of the following is the objective of the theory of constraints?

a.	maximize throughput contribution while maximizing investments and operating costs.
b.	minimizing throughput contribution while minimizing investments and operating costs.
c.	minimizing throughput contribution while maximizing investments and operating costs.
d.	maximize throughput contribution while minimizing investments and operating costs.

           

30.      The use of total quality management and flexible manufacturing practices to reduce setup costs enhances a company's ability to use

a.	economic order quantity methods.
b.	just-in-time inventory methods.
c.	first-in, first-out inventory methods.
d.	last-in, last-out inventory methods.

31.      Factors underlying make-or-buy decisions include non-quantitative factors, such as

a.	dependability of suppliers and the quality of purchased materials.
b.	dependability of suppliers and the quantity of purchased materials.
c.	dependability of employees and the quality of manufactured materials.
d.	dependability of employees and the quantity of purchased materials.

32.      When producing joint products, what are the relevant costs for a decision to sell or process further?

a.	Joint costs
b.	Costs incurred before the splitoff point
c.	Costs incurred at the splitoff point
d.	Costs incurred after the splitoff point.

33.      Which of the following describes the cost of maintaining warehouse facilities?

a.	carrying costs.
b.	set-up costs.
c.	order costs.
d.	sunk costs.

34.      Which of the following is a method of managing purchasing, production, and sales, by which the firm attempts to time purchases so that items arrive just in time for sale or production?

a.	total quality management.
b.	flexible manufacturing practices.
c.	just-in-time inventory.
d.	theory of constraints.

Answer 1

29
maximize throughput contribution while minimizing investments and operating costs. - The theory of constraint is the knowledge or philosophy that deals with anything that limits the organization ability to achieve it's goal. The constraints can be physical such as process or personnel availability , raw materials or supplies and it can also be no physical such as training, morale, procedures. Offloading work or expand the capability of the constraint can be done in order to reduce the effects of constraints also it will reduce the bottlenecks
30.   
Answer: just-in-time inventory methods - In this method materials are only received or ordered when they are needed for the production process. The advantage of this method is it minimize the cost by saving the money on overhead inventory expenses.
31.   
Answer: Dependability of suppliers and the quality of purchase material. The companies reduce their operation size by outsourcing the products.
32.   
Answer: Costs incurred after the split-off point. - This cost is called as separable Costs , where each individual products are traced. Joint costs (costs up to the split off point) and costs incurred prior to the split-off point are irrelevant for decision to sell or process further.
33.
Answer: carrying costs. - These are costs business pays for storage such as building and warehouse facility maintenance . This cost is also known as inventory carrying cost and holding cost.
34.   
Answer: just-in-time inventory. - In this method materials are only received or ordered when they are needed for the production process.. This practice will minimize the inventory levels to virtually zero.